What Is A Car Title Loan?
A car title loan is a type of secured loan where a borrower uses a vehicle as collateral. If the borrower does not repay the loan, the lender can take over possession of the vehicle. Most traditional loans from a bank or a credit union are unsecured. No collateral is offered, and the loan is “secured” with just a signature from the borrower who promises to repay the money.
How Do I Apply?
Applying for a title loan is easy these days. Lenders such as Embassy Loans of Florida allow potential borrowers to apply in person in any one of their convenient locations around the Sunshine State. Borrowers also have the option to apply online, which can help make the process more convenient. The application takes only a few minutes and begins the loan process.
Do I Have To Have Good Credit?
Auto title loans are great because there is no need for the lender to run a credit check, since the vehicle will serve as collateral. If you do not repay the loan, the lender takes possession of your vehicle. With traditional loans, a lot of time is spent researching a person’s background in order to make sure that they are a good candidate to repay a loan. That is unnecessary with vehicle title loans.
What Happens After I Apply?
You will have to verify your identity. A form of photo ID is usually required. Most lenders will verify your residency also. You must show the title to the vehicle. Your title must be clear meaning there are no liens against the vehicle. The lender will inspect your car or truck and determine its value. The estimated value will determine how much you will able to borrow.
How Long Does It Take?
In most cases, a car title loan is completed in an hour. Since there are no credit checks or background checks, the process is much faster. Many auto title loans are finished the same day that the application is started. Once the vehicle’s value is determined, the final loan documents are produced. The borrower can then pick up his or her money.